McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Chapter 1010 Motivating Employees and Building Self-Managed Teams 10-1

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Intrinsic vs. Extrinsic Rewards Intrinsic = Inside Feeling of Job Well Done Pride Sense of Achievement Extrinsic = Outside Praise SalaryIncrease Status Recognition Promotions Gifts

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Most Commonly Used Extrinsic Rewards Source: Source: Incentive Federation

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Evolution of Human Relations Management Concepts Scientific Taylor Taylor Gantt Gantt Gilbreths Gilbreths Behavioral Mayo Maslow Herzberg McGregor Ouchi Vroom

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Maslow’s Hierarchy of Needs Physiological Needs Safety Needs Social Needs Esteem Needs Self- Self-Actualization Unsatisfied Satisfied

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Why Good Workers Leave Source: Source: USA Today-Snapshot, 10/16/00

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Figure 10.5 Comparison of Maslow and Herzberg Herzberg’s Theory

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Job-Oriented Motivational Techniques  Job Enrichment/Redesign Skill VarietySkill Variety Task Identity/SignificanceTask Identity/Significance AutonomyAutonomy FeedbackFeedback  Job Simplification  Job Enlargement  Job Rotation

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved McGregor’s Theories Theory X- Autocratic Dislike WorkDislike Work Avoid ResponsibilityAvoid Responsibility Little AmbitionLittle Ambition Force/Control/ Direct/ThreatenForce/Control/ Direct/Threaten Motivated by Fear & MoneyMotivated by Fear & Money Theory Y- Democratic Like WorkLike Work Naturally Works Toward GoalsNaturally Works Toward Goals Seeks ResponsibilitySeeks Responsibility Imaginative, Creative, CleverImaginative, Creative, Clever Motivated by EmpowermentMotivated by Empowerment

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Personal Qualities Related to Job Motivation 1.Ability 2.Personal Needs 3.Frustration Tolerance 4.Self-Esteem 5.Outside Supports

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Ouchi’s Theory Z  Long-Term Employment  Collective Decision-making  Individual Responsibility  Slow Evaluation/ Promotion  Specialized Career Path  Holistic Concern for Employees

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Goal-Setting Theory (MBO)  Goal-Setting Theory  Management By Objectives (1960s) Employees Motivate ThemselvesEmployees Motivate Themselves HelpHelp CoachCoach

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Steps to Improve Performance 1)Determine Rewards Valued 2)Determine Standards 3)Ensure Standards are Attainable 4)Tie Rewards to Performance 5)Are Rewards Considered Adequate?

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Employee-Oriented Motivational Techniques Expectancy TheoryExpectancy Theory Equity TheoryEquity Theory

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Expectancy Theory: Employee Questions  What is the probability that I can perform at the required level if I try?  What is the likelihood my performance will lead to the desired outcomes?  What value do I place on the outcome?

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved  Determine rewards valued by employees.  Evaluate performance level you seek.  Make performance level attainable.  Make reward valuable to employee. How to Use Expectancy Theory

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Teamwork & Open Communication  Self-Managed Teams = Open Communication  Identify Procedures  Apply Procedures  Change Not Easy  Employee Empowerment

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Keys to Building Employee Trust  Start from a position of trust  Be consistent  Listen with an open mind & respect others’ opinions  Admit your mistakes  Give credit where credit is due Source: Source: Communication Solutions

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Keys to Keeping Morale High 1)Keep Your Ear To The Ground 2)Talk Things Out 3)Know What Your People Value 4)Laugh And Your Staff Laughs With You 5)Get Everyone Involved

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Warning Signs of Employee Stress  Drops in productivity  Chronic lateness  Absenteeism  Careless with details  Unable to work with others  Negative attitudes about work  Withdrawal from co- workers  Easily upset/angered

McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved Work Trends for the 21st Century  Tinkering With Time  Role Blur  Two Places at Once  A Super-Class  Involved Working Dads  Grieving at Work Source: Source: Wall Street Journal, 12/29/99